Network Neutrality - Related Issues - Pricing Models

Pricing Models

Broadband Internet access has most often been sold to users based on Excess Information Rate or maximum available bandwidth. Some argue that if Internet service providers (ISPs) can provide varying levels of service to websites at various prices, this may be a way to manage the costs of unused capacity by selling surplus bandwidth (or "leverage price discrimination to recoup costs of 'consumer surplus'"). However, purchasers of connectivity on the basis of Committed Information Rate or guaranteed bandwidth capacity must expect the capacity they purchase in order to meet their communications requirements.

Various studies have sought to provide network providers the necessary formulas for adequately pricing such a tiered service for their customer base. But while network neutrality is primarily focused on protocol based provisioning, most of the pricing models are based on bandwidth restrictions.

Read more about this topic:  Network Neutrality, Related Issues

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